Beauty Market Up 4%: Shifting Focus from Tradition to Injectables and Slimming Solutions

Beauty is growing, albeit timidly. The sector is targeting 4% annual growth over the next few years, with a shift in its core business. According to the latest Jefferies report, consumer spending on injectable cosmetics and weight-loss drugs will be displacing more traditional cosmetics.

The growth rate, forecast at 4% per year, will be driven by both sales volume and price increases. Potential consumers will grow as they reach sufficient income to enter the most in-demand categories, WWD reports.

However, runaway growth is not expected, with the pace slowed by the performance of China, which is falling after being a key pillar for the sector between 2016 and 2021. Jefferies also points out that the beauty sector has never been characterized by excessive growth.

Potential consumers are growing, while spending remains constant and is spread across more categories

However, Jefferies recognizes that this shift in consumer priorities may mean a shortening of growth forecasts for traditional beauty companies in the medium term, which will also feed through to their stock market value.

“Average consumers have a limited level of income earmarked for beauty spending” whose products, moreover, are highly trend-dependent. Moreover, now, with the incursion of new products such as injections or weight-loss drugs, the budget is being spread across more parties.

Beauty now encompasses more categories, but with the same share of the budget, the report says. As for the prominence of injectable cosmetics, they are expected to eventually generate 11% annual growth in the medium term. However, its offering is not as extensive as the general beauty category.